Enterprises expect easier access to credit

September 23, 2023 - 07:54
The central bank would ask credit institutions to continue reduce costs and accelerate digital transformation to create rooms for lowering rates.
Banks should simplify procedures for small and medium sized enterprises to enable them to access banking credit. — File Photo

HÀ NỘI — Enterprises expected access to banking credit to be made easier to quench their thirst for capital during the process of recovering production and business.

Trần Sỹ Thanh, Chairman of the Hà Nội People’s Committee, said at the conference to connect businesses and banks held by the State Bank of Việt Nam (SBV) on Thursday in Hà Nội that the credit policies failed to cover and support all businesses.

Thanh said that he expected banks to take timely actions to provide credit to enterprises while enterprises still have the ability to absorb capital. If the capital came late, it would be difficult for enterprises to survive, he said.

Lê Vĩnh Sơn, President of the Hà Nội Association of Main Industrial Products (Hami), said that small and medium-sized enterprises (SMEs) encountered a lot of difficulties in borrowing money from banks, including complicated procedures and prolonged loan approval times.

Sơn said that the slow reduction of rates also made it difficult for enterprises, proposing rates be lowered by 1-2 per cent, which could be sourced from the banks’ profits.

Businesses were struggling in a difficult economy, leading to the fact that the

“I do not suggest banks lower credit standards, but they could be more flexible in assessing some financial criteria,” Sơn said.

Trịnh Thị Ngân from the Hà Nội Association of SMEs said that the 2 per cent per year interest rate support programme primarily benefited large companies, while many SMEs, which needed the support most, found it difficult to access it.

Banks should simplify procedures for SMEs to allow them to access banking credit, Ngân said.

Nguyễn Trọng Hoa, director of a steel company, said that the interest rates should be lowered to around 6 per cent.

SBV Governor Nguyễn Thị Hồng mentioned that the central bank would ask credit institutions to continue to reduce costs and accelerate digital transformation to create room for lowering rates. Additionally, Hồng said enterprises should be transparent in their financial situations and cash flow so that credit institutions would not be hesitant to provide lending.

Nguyễn Thanh Tùng, director of the Bank for Foreign Trade of Việt Nam, shared that the bank would allocate VNĐ1.85 trillion from its profit to support existing loans.

Tùng also emphasised that credit standards could not be lowered to prevent an increase in bad debts in the future.

Hà Thu Giang, Director of SBV’s Credit Department, pointed out that the pressure on banking credit was immense because other capital-raising channels, such as the corporate bond and securities market, were not very efficient.

Senior economist Võ Trí Thành stated that the challenge of improving credit access and capital absorbability required a comprehensive solution that considered the entire economic system, not just the banking sector.

The SBV reduced rates four times by approximately 0.5-2 per cent in total during the first nine months of this year to support the economy. — VNS